Snapshot: Synchronica’s Mobile Email Software

Synchronica sells email and collaboration software for mobile phones. More specifically, it offers:

  • Mobile Gateway, which provides push email software for mobile phones. It also provides for desktop/mobile synchronization of calendar, address book, notes, and tasks.
  • Mobile Backup, which backs up desktop content to a remote server.

Technology Summary: Main Features

  • Provides push email on a wide range of standard mobile phones.
  • Also synchronizes common PIM information--calendar, address book, tasks, and notes information--between the office email system and mobile phones.
  • Software is sold to service providers/mobile operators, who run it on their own systems.
  • Carrier-grade architecture, designed for SaaS deployments.
  • Does not require additional client on the handset.
  • Based on Push IMAP (Lemonade/OMA EMN) and SyncML (OMA DS) protocols.
  • Microsoft Exchange information accessed via Outlook Web Access and the underlying WebDAV protocols; for Notes/Domino, CORBA protocols are used. No software required behind the firewall.
  • For consumer email synchronization--e.g., with Hotmail, Gmail--POP/IMAP protocols are used.
  • Built-in device management for OTA provisioning of IMAP and SyncML clients.

Illustrative Pricing

  • Perpetual license. Price decreases based on number of end users. Price points at 50K, 100K, 250K, 1 million, and 5 million users. 18% annual maintenance. Typical example for operator in emerging market: $2/user, for 200,000 users.
  • Annual fee, includes maintenance. About half the perpetual license cost, but payable annually.

    Main Types of Customer

  • Service providers: mobile operators, fixed operators, ISPs, ASPs, and device manufacturers.
  • End users are mainly consumers, prosumers, and organizations with up to about 1,000 staff.
  • Synchronica sells directly to service providers.
  • Alternatively, sales are via channel partners: distributors, ISVs, network equipment providers, and systems integrators

Competition

  • Consumers/prosumers: Critical Path; until it was recently acquired by Synchronica, AxisMobile also competed strongly in this segment.
  • SMEs: Seven and Visto.
  • Large enterprises: Research in Motion, Sybase/iAnyware, Microsoft, and Nokia/Intellisync. However, large enterprises are a secondary opportunity area for Synchronica.
  • Overall, Critical Path is Synchronica's main competitor.

Competitive Strengths as Perceived by Company

  • No software to install on mobile phone or behind the firewall. Synchronica uses IMAP and SyncML to exchange information with mobile phones and Outlook Web Access to access corporate mail servers. A very large number of phones have built-in support for these protocols. Critical Path, Visto, and Seven all use proprietary protocols. They therefore require special software to be installed and maintained on user handsets. They also require desktop redirectors or server-side plug-ins behind the firewall.
  • Size of addressable market. Many mobile phones don't allow software to be downloaded to them, but do support IMAP and SyncML protocols. This means that Synchronica's software works with far more phone types than competitors that use proprietary protocols. For example, Synchronica is compatible with at least 1,200 devices.
  • With the acquisition of AxisMobile, Synchronica's email synchronization software will also work with the most basic mobile phones. All phones support SMS/MMS, whether or not they support IMAP and SyncML. This is especially important in emerging markets, Synchronica's main target, where low-end devices dominate.
  • Visto, Seven, and Nokia/Intellisync require a high-end phone or smartphone, with rich computing capabilities and which allow software to be downloaded. However, most consumers and many prosumers don't have a smartphone, but they do have a phone supporting IMAP and SyncML.
  • Critical Path also uses industry standards (IMAP and SMS/MMS) to provide email for mobile phones. However, Critical Path doesn't provide synchronization of PIM data and has no connectors to Exchange or Domino.
  • Synchronica, along with its newly acquired AxisMobile, is the only company that addresses consumer, prosumer, and business space with one product. Its use of industry standards removes the need to install additional software on the handset.

Finances

  • Publicly held, on London Stock Exchange/AIM.
  • Calendar 2007 revenues: £2.3M ($4.3M); calendar 2006 revenues £1.1M ($2.0M).
  • Current round of funding due to close September 2008 for £5.1M ($9.4M).
  • Not yet profitable.

Challenges

  • Other competitors may encroach on standards-based technology.
  • Synchronica believes emerging markets are a major opportunity area. They may be slow to adopt collaborative technologies such as email and calendaring.
  • Integration of the AxisMobile email-to-SMS/MMS gateways may be more difficult than anticipated.
  • Mobile phones in emerging markets might become as powerful as smartphones, quite quickly. They might all have built-in support for, say, Microsoft's ActiveSync. In this case, much of Synchronica's appeal or low-end devices would evaporate.

Miscellaneous Comments

  • Downloading software to mobiles is costly in terms of user time and help desk support time. There is much merit in the idea of providing mobile phones with standards-based messaging technology, so the phones can use their built-in messaging client software.
  • Most mobile users don't have smartphones; this is especially true when one considers low- and middle-income countries. Today's popular mobile messaging technology serves the masses poorly.
  • The provision of email via SMS/MMS is interesting. A lot of phones in emerging markets are very basic, and don't have IMAP or SyncML clients.

... David Ferris

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